10-1 Identify the changes taking place in the form and use of decision support in business Identify the role and reporting alternatives of management information systems Describe how online analytical processing can meet key information needs of managers Explain the decision support system concept and how it differs from traditional management information systems Learning Objectives

10-2 Learning Objectives Explain how the following information systems can support the information needs of executives, managers, and business professionals Executive information systems Enterprise information portals Knowledge management systems Identify how neural networks, fuzzy logic, genetic algorithms, virtual reality, and intelligent agents can be used in business

10-3 Learning Objectives Give examples of several ways expert systems can be used in business decision-making situations

10-4 Decision Support in Business Companies are investing in data-driven decision support application frameworks to help them respond to Changing market conditions Customer needs This is accomplished by several types of Management information Decision support Other information systems

10-5 Case 1: Dashboards for Executives Web-based “dashboards” Displays critical information in graphic form Assembled from data pulled in real time from corporate software and databases Managers see changes almost instantaneously Now available to smaller companies Potential problems Pressure on employees Divisions in the office Tendency to hoard information

10-6 Case Study Questions What is the attraction of dashboards to CEOs and other executives? What real business value do they provide to executives? The case emphasizes that managers of small businesses and many business professionals now rely on dashboards. What business benefits do dashboards provide to this business audience?

10-7 Case Study Questions What are several reasons for criticism of the use of dashboards by executives? Do you agree with any of this criticism?

10-8 Levels of Managerial Decision Making

10-9 Information Quality Information products made more valuable by their attributes, characteristics, or qualities Information that is outdated, inaccurate, or hard to understand has much less value Information has three dimensions Time Content Form

10-10 Attributes of Information Quality

10-11 Decision Structure Structured (operational) The procedures to follow when decision is needed can be specified in advance Unstructured (strategic) It is not possible to specify in advance most of the decision procedures to follow Semi-structured (tactical) Decision procedures can be pre-specified, but not enough to lead to the correct decision

10-12 Decision Support Systems Management Information Systems Decision Support Systems Decision support provided Provide information about the performance of the organization Provide information and techniques to analyze specific problems Information form and frequency Periodic, exception, demand, and push reports and responses Interactive inquiries and responses Information format Prespecified, fixed formatAd hoc, flexible, and adaptable format Information processing methodology Information produced by extraction and manipulation of business data Information produced by analytical modeling of business data

10-13 Decision Support Trends The emerging class of applications focuses on Personalized decision support Modeling Information retrieval Data warehousing What-if scenarios Reporting

10-14 Decision Support Systems Decision support systems use the following to support the making of semi-structured business decisions Analytical models Specialized databases A decision-maker’s own insights and judgments An interactive, computer-based modeling process DSS systems are designed to be ad hoc, quick-response systems that are initiated and controlled by decision makers

10-15 DSS Components

10-16 DSS Model Base Model Base A software component that consists of models used in computational and analytical routines that mathematically express relations among variables Spreadsheet Examples Linear programming Multiple regression forecasting Capital budgeting present value

10-17 Management Information Systems The original type of information system that supported managerial decision making Produces information products that support many day-to-day decision-making needs Produces reports, display, and responses Satisfies needs of operational and tactical decision makers who face structured decisions

10-18 Management Reporting Alternatives Periodic Scheduled Reports Prespecified format on a regular basis Exception Reports Reports about exceptional conditions May be produced regularly or when an exception occurs Demand Reports and Responses Information is available on demand Push Reporting Information is pushed to a networked computer

10-19 Using Decision Support Systems Using a decision support system involves an interactive analytical modeling process Decision makers are not demanding pre-specified information They are exploring possible alternatives What-If Analysis Observing how changes to selected variables affect other variables

10-20 Using Decision Support Systems Sensitivity Analysis Observing how repeated changes to a single variable affect other variables Goal-seeking Analysis Making repeated changes to selected variables until a chosen variable reaches a target value Optimization Analysis Finding an optimum value for selected variables, given certain constraints